Role of Chinese companies in selling possible weapons materials to Iran arises

Washington (CNN) -- China has played a critical role in U.S. policy toward Iran since the Obama administration came into office, according to a CNN review of State Department cables published by WikiLeaks.

The documents shine a light on China's role as middle man between the United States and Iran in encouraging the two countries to engage in direct talks, even though Washington and Tehran have not had diplomatic relations since the Iranian embassy hostage crisis of 1979.

China may be talking to the United States about containing Iran's nuclear program, but the cables also reveal the role of Chinese enterprises in Iran's strategy to obtain materials for its missile programs and the U.S. State Department's efforts to counter that strategy.

Through official and nonofficial channels, the Chinese government sought to encourage the Obama administration and the Iranian government to directly engage each other. Xu Wei, a diplomat in the Iran division of the Chinese foreign ministry, told a U.S. political officer in March of 2009 that Beijing was hoping for "more clarity from the United States." Xu expressed the hope that Washington's Iran policy review would lead to direct talks between Iran and the United States.

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He also offered the Chinese government's assistance in creating a channel of communications between Washington and Tehran. At the same time, Xu said China was encouraging Iran to engage with the United States, but warned the U.S. diplomat that talks with the Iranians would require patience.

Five months later, Li Guofu, the director of a Chinese think tank affiliated with the Chinese foreign ministry, told a U.S. diplomat that Iran was skeptical about the United States' ability to make a deal on the nuclear issue because of domestic political pressures, but that a visit by a high-level emissary like former Secretary of State Henry Kissinger or former president Bill Clinton might send them the right signals.

Li also said that President Mahmoud Ahmadinejad's congratulatory letter to the American president-elect after the 2008 election was a "a sincere indication of the Iranian leadership's willingness to talk."

However, Li also noted that President Barack Obama's positive image among the Iranian people -- "Obama is with us," was a public sentiment relayed to Li by his Iranian contacts -- contributed to the Iranian leadership's reluctance to reach out to the United States.

According to a cable from U.S. Ambassador to China Jon Huntsman, a diplomat in the Iran division of the Chinese foreign ministry said that while in Iran he had seen a debate going on about the utility of the country's nuclear program.

The cable quotes the diplomat as saying: "Many Iranians did not see the use in having nuclear technology and saw it only as a source of problems, while others saw value in the possession of nuclear technology but were reconsidering this view because of progress in talks with the United States."

But the diplomat notes that conservatives in Iran were not inclined to make concessions on the nuclear issue.

When asked if Iran thought China could act as an honest broker between the two countries, Li responded "Iran trusts nobody," and that if a choice had to be made, the Iranian leadership believed China would ultimately side with the United States over Iran.

The role of Chinese companies in selling possible weapons materials or technology to Iran arises in multiple cables from the Secretary of State's office. A cable dated September of 2009 expressed concerns about a French firm's sale of infrared detectors to Zhejiang Dali Technology Company Ltd, a Chinese firm, for use in its thermal imaging systems.

The State Department believed Zhejiang Dali is selling its thermal imaging systems to Iranian defense entities, which the cable says "could increase the threat to US and allied forces operating in the Gulf region." The cable continues: "If these [infrared detectors] were included in the optical targeting mechanism for tanks and air defense systems, they could potentially be used to degrade US superiority in night combat operations."

A second cable from February of 2010 sent to the U.S. embassy in Beijing expressed similar concerns about Hong Kong 4 Star Electronics Ltd., a Chinese company offering to sell Russian-made gyroscopes to an Iranian company.

"Because key missile development organizations in Iran previously have attempted to procure similar gyroscopes, we are concerned this equipment potentially could be diverted to missile-related end-users," the cable says.

The document included a series of talking points expressing U.S. concerns about the transaction and urged Chinese counterparts to ensure that the company was "not facilitating unauthorized exports of missile technology to Iran," consistent with U.N. resolutions 1737 and 1803.

A third cable, dated February of 2010, highlights the Malaysian company Electronics Component Limited's attempts to obtain gyroscopes from a Chinese firm. The gyroscopes, which the document says are subject to international and Chinese missile control regimes, are "suitable for use in the guidance systems of ballistic missiles, cruise missiles, and unmanned aerial vehicles."

Of particular concern to the department is ECL's ties to a network of Iranian-controlled front companies dedicated to the procurement of sensitive materials. The document calls on the Chinese government to stop the transfer of gyroscopes to ECL.

A fourth cable, also dated February of 2010, noted an Iranian company's efforts to procure five tons of carbon fiber from the Yoon Networks Shanghai Company, a Chinese firm.

The cable states the department's belief that the Iranian company was trying to obtain the materials on behalf of the Shahid Bakeri Industries Group, which is responsible for Iran's ballistic missile program. According to talking points included in the document, the fiber could be used to produce rocket nozzles for short and medium-range ballistic missile systems, and the cable calls on the Chinese government to investigate this activity and prevent any transfers that could be used for Iran's missile program.